Stocks Close Mixed Ahead Of Jobs Report, Long Weekend - U.S. Commentary

4/5/2012 4:24 PM ET

Stock showed a lack of direction throughout the trading day on Thursday, with some traders looking to get a head start on the long weekend. Uncertainty about Friday's monthly employment report also contributed to the choppy trading.

The major averages bounced back and forth across the unchanged line, eventually ending the session mixed. While the Nasdaq rose 12.41 points or 0.4 percent to 3,080.50, the Dow edged down 14.61 points or 0.1 percent to 13,060.14 and the S&P 500 slipped 0.88 points or 0.1 percent to 1,398.08.

Meanwhile, the major averages all moved lower for the holiday-shortened week. The Dow fell by 1.1 percent, while the Nasdaq and the S&P 500 dropped by 0.4 percent and 0.7 percent, respectively.

The lackluster performance on Wall Street came as many traders stayed on the sidelines ahead of the release of the Labor Department's March jobs report on Friday.

With the U.S. stock markets closed for Good Friday, traders will have to wait until next Monday to react to the actual jobs numbers.

The report is expected to show the addition of at least 200,000 jobs for the fourth month in a row in March, although the unemployment rate is expected to remain elevated at 8.3 percent.

As a result of the focus on the monthly report, traders largely shrugged off the release of a separate Labor Department report showing a modest drop in jobless claims in the week ended March 31st.

The report showed that jobless claims fell to 357,000 from the previous week's revised figure of 363,000. Economists had expected jobless claims to edge up to 360,000 from the 359,000 originally reported for the previous week.

With the unexpected decrease, jobless claims fell to their lowest level since coming in at 352,000 in the week ended April 19, 2008.

Among individual stocks, Bed Bath & Beyond (BBBY) rose by 8.5 percent after the home furnishings retailer reported better than expected fourth quarter results. The company also forecast full year earnings growth in the high-single to low-double digit percentage levels.

Meanwhile, shares of Ruby Tuesday's (RT) fell by 18.1 percent after the restaurant operator reported disappointing third quarter revenues and warned of weaker than expected full year earnings.

Sector News

Despite the lackluster performance by the broader markets, considerable weakness was visible among electronic storage stocks. The NYSE Arca Disk Drive Index dropped by 1.3 percent to its lowest closing level in a month.

Seagate Technology (STX) and Western Digital (WDC) turned in two of the storage sector's worst performances, falling by 6.3 percent and 3.7 percent, respectively.

Networking stocks also saw significant weakness, with Polycom (PLCM) leading the sector lower after providing disappointing first quarter guidance. Shares of Polycom plunged by 20 percent, helping to drag the NYSE Arca Networking Index down by 1.7 percent.

Gold, housing, and utilities stocks also posted notable losses on the day, while strength was visible among health insurance, software, and biotech stocks.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region moved mostly lower on Thursday. Japan's Nikkei 225 Index fell by 0.5 percent, while Hong Kong's Hang Seng Index ended the day down by 1 percent.

Meanwhile, the major European markets turned mixed over the course of the trading day. While the German DAX Index edged down by 0.1 percent, the French CAC 40 Index crept up by 0.2 percent and the U.K.'s FTSE Index rose by 0.4 percent.

In the bond market, treasuries moved to the upside on the day, further offsetting the steep drop seen on Tuesday. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, fell by 6.8 basis points to 2.175 percent.

Looking Ahead

While reaction to the monthly jobs report is likely to drive trading early next week, reports on the U.S. trade deficit, consumer sentiment, and producer and consumer price inflation are likely to be in focus later in the week.